An overview of upcoming transparency – What the Budget promises

Controlling the Black money menace and trying to cover its trail is not a menial task. But curbing it properly won’t be an absolute negation too. With the Narendra Modi Government highlighting it as one of the main intents of its recent experiments of demonetization, a plausible mention of it in the Central Budget 2017 was expected.

Starting by evaluating the efficacy of the demonetization drive, Finance Minister Arun Jaitley showered praise after praise as he went on to explain how the drive has helped curb illicit money laundering and possession of black money. The main points of the appraisal has been highlighted below.

Fencing the liquidity of transactions

Further pursuance of this idea was rolled into motion by putting forward an acceptable amendment to the Income-Tax Act, under the header of the Finance Bill.

The highlight of his speech included a key decision that placed limitations on cash transactions. In a country that is not averse to the idea of holding large amounts of currency at once, limiting transactions and possession made a strong point. Basing its new policy change on the suggestions of the Special Investigation Team (SIT), headed by Justice (retd) M B Shah, the idea of no transaction of above Rs. 3 lakhs being permitted in cash was put forward. Further pursuance of this idea was rolled into motion by putting forward an acceptable amendment to the Income-Tax Act, under the header of the Finance Bill.

Reducing the opacity of political funding

Critics often target political parties over the lack of transparency in their funding. It is widely speculated that there is high-level corruption involved in the process. Money laundering sprouts as a notable conclusion. With a politically correct tone of ensuring that the ‘Free and Fair’ spirit of the Elections be honored, Jaitley announced several rules that may act as a precursor to the realization of this notion.

Key factors involved digitalization of the donations that will be received by political parties and setting up a cap of Rs. 2000/- from one person as the amount of cash that can be donated.

With an agenda of introducing pillars of accountability and transparency in political funding, it would be mandatory for every Political Party to file its return within the stipulated time set under the ambit of the Income-Tax Act.

To digitize the country

Post intensive emphasis on the promotion of a Cashless/Digital economy, which would force out tears of happiness from founders of PayTM and Paypal, strengthening of taxation laws was talked about. Reasonability of taxation rates and enlarging the tax base in the country were factors that the Government was more than willing to take into account.

Two targets, one shot

As of now, these changes suggested in the budget do usher in a wave of change. Though it sure sounds remedial on paper, implementation of these policies is the real deal. Fruitful measures that would aim to take down Money-Laundering and curbing black money, in one shot, ideally should be on the fore.